FUTURESMART MINING Tony ONeill, Group Technical Director, Anglo - - PowerPoint PPT Presentation

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FUTURESMART MINING Tony ONeill, Group Technical Director, Anglo - - PowerPoint PPT Presentation

FUTURESMART MINING Tony ONeill, Group Technical Director, Anglo American Anglo American Analyst Roundtable 20 May 2019 1 CAUTIONARY STATEMENT Disclaimer: This presentation has been prepared by Anglo American plc (Anglo American) and


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FUTURESMART MINING™

Tony O’Neill, Group Technical Director, Anglo American Anglo American Analyst Roundtable 20 May 2019

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CAUTIONARY STATEMENT

Disclaimer: This presentation has been prepared by Anglo American plc (“Anglo American”) and comprises the written materials/slides for a presentation concerning Anglo American. By attending this presentation and/or reviewing the slides you agree to be bound by the following conditions. The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. This presentation is for information purposes only and does not constitute an offer to sell or the solicitation, inducement or an offer to buy shares in Anglo American or any other securities. Further, it does not constitute a recommendation by Anglo American or any

  • ther party to sell or buy shares in Anglo American or any other securities and should not be treated as giving investment, legal, accounting, regulatory, taxation or other advice.

No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contain herein. None of Anglo American, its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this material or otherwise in connection with this material. Forward-looking statements This presentation includes forward-looking statements. All statements other than statements of historical facts included in this presentation, including, without limitation, those regarding Anglo American’s financial position, business, acquisition and divestment strategy, dividend policy, plans and objectives of management for future operations (including development plans and objectives relating to Anglo American’s products, production forecasts and reserve and resource positions), are forward-looking statements. By their nature, such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Anglo American, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding Anglo American’s present and future business strategies and the environment in which Anglo American will operate in the future. Important factors that could cause Anglo American’s actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others, levels of actual production during any period, levels of global demand and commodity market prices, mineral resource exploration and development capabilities, recovery rates and other operational capabilities, the availability of mining and processing equipment, the ability to produce and transport products profitably, the availability of transport infrastructure, the impact of foreign currency exchange rates on market prices and operating costs, the availability of sufficient credit, the effects of inflation, political uncertainty and economic conditions in relevant areas of the world, the actions of competitors, activities by governmental authorities such as permitting and changes in taxation or safety, health, environmental or other types of regulation in the countries where Anglo American operates, conflicts over land and resource ownership rights and such other risk factors identified in Anglo American’s most recent Annual Report. Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements. These forward-looking statements speak only as of the date of this presentation. Anglo American expressly disclaims any obligation or undertaking (except as required by applicable law, the City Code on Takeovers and Mergers (the “Takeover Code”), the UK Listing Rules, the Disclosure and Transparency Rules of the Financial Conduct Authority, the Listings Requirements of the securities exchange of the JSE Limited in South Africa, the SIX Swiss Exchange, the Botswana Stock Exchange and the Namibian Stock Exchange and any other applicable regulations) to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in Anglo American’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Nothing in this presentation should be interpreted to mean that future earnings per share of Anglo American will necessarily match or exceed its historical published earnings per share. Certain statistical and other information about Anglo American included in this presentation is sourced from publicly available third party sources. As such it has not been independently verified and presents the views of those third parties, but may not necessarily correspond to the views held by Anglo American and Anglo American expressly disclaims any responsibility for, or liability in respect of, such information. No Investment Advice This presentation has been prepared without reference to your particular investment objectives, financial situation, taxation position and particular needs. It is important that you view this presentation in its entirety. If you are in any doubt in relation to these matters, you should consult your stockbroker, bank manager, solicitor, accountant, taxation adviser or other independent financial adviser (where applicable, as authorised under the Financial Services and Markets Act 2000 in the UK, or in South Africa, under the Financial Advisory and Intermediary Services Act 37 of 2002). Alternative Performance Measures Throughout this presentation a range of financial and non-financial measures are used to assess our performance, including a number of financial measures that are not defined or specified under IFRS (International Financial Reporting Standards), which are termed ‘Alternative Performance Measures’ (APMs). Management uses these measures to monitor the Group’s financial performance alongside IFRS measures to improve the comparability of information between reporting periods and business units. These APMs should be considered in addition to, and not as a substitute for, or as superior to, measures of financial performance, financial position or cash flows reported in accordance with IFRS. APMs are not uniformly defined by all companies, including those in the Group’s industry. Accordingly, it may not be comparable with similarly titled measures and disclosures by other companies.

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WE ARE RE-IMAGINING MINING

Operating Model P101 FutureSmart Mining

Digitalisation The Intelligent Mine Technology Innovation The Concentrated Mine The Waterless Mine The Modern Mine Sustainability Sustainable Mining Plan

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OPERATIONAL EXCELLENCE AS STANDARD

Operating Model

1. Provides clarity 2. Produces stability 3. Reduces variability

“Integrity and certainty, by nature”

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FUTURESMART MINING™

Concentrated Mine™ Waterless Mine Intelligent Mine Modern Mine

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STEP-CHANGING THE INTENSITY EQUATION

Challenge Precision mining with minimal energy, water and capital intensity Approach Concentrate the Mine™ concept:

  • 1. Coarse particle recovery
  • 2. Bulk sorting
  • 3. Grade Engineering™
  • 4. Precision classification
  • 5. Ultrafine recovery
  • 6. Novel leach

Value CPR: 20% increase in throughput, 85% recovery of water Bulk sorting: 5% grade improvement, 20% more throughput Ultrafine recovery: 2-4% recovery improvement Novel Leach: 60-80% recovery

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Challenge ~75% current portfolio located in water constrained regions Approach

  • 1. Coarse particle recovery
  • 2. Dry stacking
  • 3. Dry processing

Value Reduced footprint Increased water recovery Reduced TSF risk Removal of expansion constraints

RECOVERING AND AVOIDING WATER

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NOVEL LEACHING UNLOCKING NEW VALUE

Challenge Re-dressing environmental legacies to recover low grade mineral concentrates Approach 1. Novel leach 2. Coarse particle recovery Value Re-dressing environmental legacies Reduction in water intensity Reduction in energy intensity Removal of constraint elements to enable new low grade recovery

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DELIVERING ENDURING VALUE THROUGH SMART ENERGY

Challenge Transformational use of renewables Approach

  • 1. Oversize PV
  • 2. Plant tariff demand arbitrage
  • 3. Produce H2 with excess PV
  • 4. Consume H2 in trucks

Value Reduce GHG on large site by 30% in plant and 100% in trucks Increase truck power by 5% Energy security Price resilience Move to hydrogen economy Next generation mining vehicles Host community participation

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RE-DEFINING THE RISK PROFILE

Challenge Everyone goes home safely every day Approach

  • 1. Modernise – Electro-hydraulic drills, gel

explosives, no scraper-winches

  • 2. Mechanise – Remote operated ultra-low-

profile equipment

  • 3. Continuous cutting – Hard rock cutting

machines

  • 4. Swarm robotics – Small self-organising

intelligent machines Value Safer and more efficient working environment Transition pathway in existing operations

Work

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RE-DEFINING THE RISK PROFILE

Challenge Eliminate wet tailings Approach Reduce risk

  • 1. Fibre-optic sensing
  • 2. Satellite monitoring

Eliminate

  • 1. Coarse particle recovery
  • 2. Unsaturated stacking
  • 3. Dry processing

Value Increased water recovery >80% for similar cost Reduced footprint Increased water recovery New value options

Tailings

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ENGINEERING DRY STACKS

Challenge Create a dry stable stack from wet tails Approach

  • 1. Engineer and construct vs placement
  • 2. Hydraulically place CPR sand with

conventional thickened tailings

  • 3. Creates drainage pathways throughout

Value Water recovery for additional production Rapid transition to dry, stable stack Enables future repurposing for land use Engineered to eliminate the risk of liquefaction Low opex – comparable to wet tailings

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AUTHORING THE OPTIMAL MINING SYSTEM WITH DIGITALISATION

Advanced Process Control

2% recovery/yield 5% process throughput 30% process stability 5% energy efficiency

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DATA ANALYTICS PLATFORM

Providing business insight, empowering better decisions

Approach

  • 1. Build an end-to-end data

platform that supports the entire value chain

  • 2. Use artificial intelligence to

interpret data

  • 3. Engage end users with

next generation apps that are mobile-friendly

  • 4. Productization strategy

helps with scaling our value generation Value Speed to market Scale of deployment IT/OT integration delivers value Operations decision support focused 1 2 3 4

Criteria

  • Capability & Capacity
  • Speed to delivery
  • Commercials (incumbency,

rate cards)

  • Scalability
  • Cultural fit
  • Industry experience
  • Functional fit
  • Capability & Capacity
  • Speed to delivery
  • Commercial sensitivity
  • Strategic fit
  • Functional fit
  • Speed to delivery
  • Application acceleration
  • Geographic coverage
  • Scalability
  • Security
  • Commercials (platform cost,

discounts, investments)

  • Integration with AA IM estate

System Integration

(SI work required across all DA functional channels, effort will include: app development, specialized input, data lake design/build, change management)

Component

Data Analytics & Presentation Layer Data Lake Base Platform

Result

AA will prime PMO, product development & vendor management. Preferred SIs complete design, development and delivery with AA. (may vary by use case).

Options1

AA to Prime Support

AA and best of breed solutions based on capability and strategic

  • considerations. Built

leveraging AA reference architecture and Data Lake.

Anglo American Data Platform

MINING DATA LAKE

io io

Ingestion services

MINING PROCESSING GEOSCIENCE MARKET PRICES

NEXTGEN APPS

Technical expert

MinePlan

ANALYTICS DATA SCIENCE

Data scientist

Sensors Real-time

Historians

Fleet Management Systems Application Data

Consumption services QC

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CAVITY PREDICTION DURING LONGWALL OPERATIONS

Challenge Predict cavity risk to optimise operating approach Approach

  • 1. Use artificial intelligence to model the

parameters and learn from outcomes

  • 2. Identify geologically similar blocks
  • 3. Determine historically best operating regime
  • 4. Recommend future operating regime to
  • ptimise production

Value Predict cavity risk ahead of mining operations Improves safety Boosts productivity Adaptable to changing conditions

Before After

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Textural Search …

ASSISTED HYPERSPECTRAL CORE LOGGING

Challenge Precision geological information in minimal time Approach Use machine learning to augment geoscience expertise and automate logging & material classification Value Dramatic decrease in drill to resource model time Increase in precision logging and material classification Increased SME availability to build better model interpretations Reduced risk to personnel

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$3-4BN COST & VOLUME IMPROVEMENT

20191 20181 2020-221 $2-3bn $0.5bn $3-4bn

Operating Model & P101 Projects Technology & Innovation Other cost & volume Met Coal P101

~$1bn

Technology and innovation:

$0.4bn

1. EBITDA volume and cost variance. Volume variance calculated as increase/(decrease) in sales volumes multiplied by prior period EBITDA margin. For assets in the first 12 months following commercial production all EBITDA is included in the volume variance, as there is no prior period comparative. Cost variance includes inventory movements.

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FUTURESMART MINING™

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THANK YOU